Immigrants at the Heart of American Innovation

Immigrants are overrepresented in the fields of science and technology, providing the U.S. with numerous patents; a windfall that benefits the entire economy.

“The influx of foreign workers holds down salaries, and keeps unemployment high,” according to the campaign website of Donald Trump, Republican presidential candidate. To help American workers, Trump suggests making it more difficult for companies to recruit foreign workers with H-1B visas. These visas are primarily used to attract highly qualified workers to the fields of science and technology.

When he was little, Pierre Omidyar immigrated to the United States with his parents, so that his father could work as a doctor at the prestigious Johns Hopkins University. A French-born Iranian, Pierre Omidyar went on to found eBay in the United States in 1995. Thus, one of the biggest American internet companies was created by a French immigrant!

And Pierre Omidyar is not alone—far from it. U.S. immigrants are overrepresented in the fields of science and technology. A quarter of the members of the American Academy of Sciences are immigrants. Of the scientists who helped to found the biotechnological startups that were introduced into the stock market, a quarter were immigrants. And a quarter of American patents are filed by immigrants.*

Home to the most foreign graduates since 1940, America has seen a sharp rise in its number of patents (Hunt and Gauthier-Loiselle, 2010). The H-1B visa, criticized by Trump, is itself a major factor in this innovation. So an increase in the number of these visas brings with it a rise in the number of patents filed by foreign workers.**

Yet does the influx of all these foreign workers have a negative impact on American salaries? Is Trump right? Scientific studies carried out on the subject show that the influx of highly qualified foreign workers also stimulates the number of patents filed by Americans. Immigrants generate a scientific corpus that Americans can make use of too, resulting in collaborations that reinforce this positive effect.

The studies also demonstrate that the H-1B visas particularly benefit cities that already have large foreign communities due to immigrants reuniting with their former compatriots. There is also a link between the wage curve and the number of visas granted: the proportion of foreign workers in the fields of science and technology considerably increases the salary of Americans, whether qualified or not.*** Given that innovation is crucial to economic growth, the influx of immigrants via the H-1B visa program boosts American growth in the long term.

Once again, Trump has got it wrong. To be true to his slogan “Make America Great Again,” he should, on the contrary, be encouraging immigration via H-1B visas.

*Author’s footnote: Hunt and Gauthier-Loiselle, 2010: http://ftp.iza.org/dp3921.pdf

**Author’s footnote: Kerr and Lincoln, 2010: http://www.hbs.edu/faculty/Publication%20Files/09-005.pdf

***Author’s footnote: Peri, Shih and Sparber, 2014: http://www.nber.org/papers/w20093